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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: rudedog who wrote (159631)	8/14/2000 4:39:39 PM
From: kaka	Read Replies (1) \| Respond to of 176387

Hi Rudedog, This is from DELL's press release. "Quarterly revenue from Europe, the Middle East and Africa increased 10 percent year-over-year, led in part by solid growth in sales to small-business customers across the region, including in the United Kingdom, France and Germany. Dell ranked No. 2 in terms of regional market share, up from the No. 4 a year ago and No. 3 in Q1, as its European unit volumes rose slightly in a market where growth was below industry expectations. In the meantime, the company's focus on costs and margins resulted in a 24-percent sequential increase in operating income. Company sales in Asia-Pacific, including Japan, rose 48 percent, including a 93-percent increase in revenue from enterprise products. In China, sales were up 86 percent year-over-year." The fact that DELL Europe rose from number 4 to number 2 in small business tells me they are growing faster than the competition regardless of the method they are using to sell computers. In Asia and China they can still display those big growth numbers since the actual % is so small. I'm hard pressed to believe DELL will ever use a different model for Europe(at least not publicly); that would be a sort of disqualification of the Direct Way! Saturation in the US makes DELL rely more on product cycles, and new products, and here new initiative by IBM and HP in legacy free, USB machines might look attractive to many companies. My frustration is very much at the stock price vs. company growth. I know lots compare DELL's stock performance to SUNW's, and while I try not to fall into that trap, it is wholly unfair that SUNW should command such a high PE when all the data I can find shows SUNW's growth rate is just now approaching what DELL's is decelerating to. I don't care about how DELL makes their numbers; they can sell only one configuration of only one PC-if they sell enough to maintain 30%, that still is 30% growth. They shouldn't need to be thought of as a turnaround story with that type of revenue growth. But like you state, we will be range bound, and now the range has been set so much lower. Can't blame that on shorts, or a bear NASDAQ/DOW market. kaka

To: rudedog who wrote (159631)	8/14/2000 6:19:41 PM
From: D.J.Smyth	Read Replies (5) \| Respond to of 176387

Rude, re servers: ...But no matter what happens in desktops, the real story is servers. DELL ought to be growing that business at twice the market rate, not a few points ahead of the market, if they are to shift their revenue into servers. Dell's Enterprise sales this year will amount to over $6.5 billion. SUNW's Enterprise will equal over $14 billion (factoring out their different divisions). If Sunw's $15 billion receives a market cap of $140 billion (discounting other divisions), while growing at a 46% per annum rate, then Dell's $6.5 billion should receive no less than a $65 billion market cap growing at about the same rate. Considering a 45% growth of that division over the next twelve months, Dell's Enterprise sales would equal $11 billion. So giving it the 10X award given SUNW, Dell's Enterprise Division should have a $110 billion forward looking market cap. Thus, looking forward, the market is not only discounting Dell's Laptop and PC division it is giving it a forward looking value close to $0 (relative to SUNW). Instead of consistent yadayada on Dell's Enterprise Division performance, why not value it equal to it's brethren given the same growth and earnings rates? the market continues to award SUNW a proportionate marketshare relative to their growth rate. Yet it discounts the SAME growth rate for Dell using "absolute" numbers, as you so state! Dell's Enterprise division growth of 46% is somehow less honorable than SUNW's Enterprise growth of 46%. Guess who is chasing whom. Otherwise, looking at Asia's "absolute" numbers in Enterprise/PC/laptop sales, brings them close to 22% of the world total. Yet, Asia contains nearly 65% of the world population. What "absolute" part of nearly 22% is not significant in your view? It is expected that by 2005 Asia will comprise over 50% of the world total computing sales. That 50% could represent over $350 billion in absolute sales by then given current projections and growth rates. What amount of this $350 billion in Asian sales would Dell eventually represent?